iRhythm’s third quarter results were driven by strong commercial momentum across both core Zio Monitor and Zio AT products, with management citing a record number of new account openings and expanded adoption among large healthcare networks. CEO Quentin Blackford pointed to the company's ability to onboard entire customer networks from the outset and growing integration with electronic health records (EHR) systems as key drivers of the volume growth. Management highlighted that 76 of the top 100 customers are now EHR-integrated, which has led to a meaningful increase in monitoring volumes and workflow efficiency for clinicians.
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iRhythm (IRTC) Q3 CY2025 Highlights:
- Revenue: $192.9 million vs analyst estimates of $184.4 million (30.7% year-on-year growth, 4.6% beat)
- Adjusted EPS: -$0.06 vs analyst estimates of -$0.28 (78.8% beat)
- Adjusted EBITDA: $21.56 million vs analyst estimates of $17.32 million (11.2% margin, 24.5% beat)
- The company lifted its revenue guidance for the full year to $737.5 million at the midpoint from $725 million, a 1.7% increase
- Operating Margin: -4.4%, up from -34.1% in the same quarter last year
- Market Capitalization: $5.82 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From iRhythm’s Q3 Earnings Call
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Nathan Treybeck (Wells Fargo) asked about the drivers behind new account openings and whether volume growth reflected share shift or market expansion. CEO Quentin Blackford highlighted both larger, system-wide conversions and increased adoption in primary care and innovative channels.
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Richard Newitter (Truist) pressed for expectations on the growth trajectory of the upcoming Zio MCT device. Blackford said the company is planning for launch in the back half of next year, but will not include MCT in guidance until FDA timelines are clearer.
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David Saxon (Needham & Company) inquired about onboarding and penetration of the innovative partner channel. Blackford described highly variable sales cycles but confirmed that incremental revenue contributions are growing and that most partners target asymptomatic, undiagnosed populations.
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Stephanie Piazzola (Bank of America) sought details on the company’s sleep diagnostics efforts. Blackford explained that pilots are underway and that future diagnostic capabilities could be built on the existing wearable platform, leveraging prior IP acquisitions.
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Nathan Treybeck (Wells Fargo) followed up on the Zio MCT’s “downgradable” features and reimbursement implications. Blackford confirmed the flexibility but stated the commercialization approach is still being evaluated, and the company does not anticipate a large mix of unreimbursed scripts currently.
Catalysts in Upcoming Quarters
Going forward, StockStory analysts will monitor (1) the pace of EHR integration and associated volume growth, (2) conversion and scaling of innovative partner channels targeting undiagnosed populations, and (3) progress toward regulatory approval and launch of the Zio MCT device. Developments in adjacent markets such as sleep diagnostics and continued gross margin expansion through automation will also be key indicators of execution.
iRhythm currently trades at $181.13, down from $184.42 just before the earnings. In the wake of this quarter, is it a buy or sell? See for yourself in our full research report (it’s free for active Edge members).
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